Defence shuffle needs to end

Alot has changed militarily and economically in Australia’s strategic outlook since the 2009 defence white paper, but bringing forward a new one, as the government is doing, does not make much sense unless you have the credibility to implement it. With changing defence ministers, lax fiscal control and some lack of clarity about regional foreign policy – not to mention a parlous electoral situation – the government is not in a strong position to be designing a new long-term defence policy.

After the problems in delivering other projects on time and budget, Prime Minister
Julia Gillard
should be focusing on how to get best value for taxpayers’ money rather than raising expectations in industry and Adelaide that our next fleet of submarines will be built in ­Australia. Defence policy is being confused with industry ­policy. Budget and strategic considerations suggest a swift ­foreign purchase is the right course, with some spending on ­better basing and maintenance.

The strong dollar means the vessels will be cheaper to buy ­offshore. Local construction would just add to the mining boom’s labour shortages and further threaten projects such as Olympic Dam, on which South Australia should stake its future.

Productivity Commission chairman
Gary Banks
has identified the submarine project as an obvious long-term budget ­saving. It is also the best way that Defence can contribute to the fiscal tightening intended to get the budget on a sounder footing. But the question that arises from the sudden budget cutting is how much previous spending on planning will prove to be ­simply wasted.

Nevertheless, the principal part of yesterday’s $1.6 billion saving over four years – the delay in the purchase of Joint Strike Fighters – is a reasonable step since these planes are facing their own questions in the United States.

The good news out of the pre-budget defence positioning ­yesterday is that the force posture review provides some practical advice about not spending excessively on new bases as part of the necessary refocusing of defence on the resource-rich north-west, and for better co-operation with industry and state governments.

It also makes the point that, at a time of concern about inadequate defence capacity, that threats to northern resource wealth, engagement with customers through global markets, and foreign investment should reduce the prospect of resource conflict.

The government is getting advice on the changing region from its Asia white paper and now has the considered posture review on hand. So while a new agreed strategic outlook paper would be useful, the government might be better off fixing already identified problems rather than allowing them to be papered over by waiting around for a new white paper.